Good Morning!

Futures in the red at the time of this writing as talking heads focus on today’s big economic calendar including December’s Nonfarm Payrolls report along with the massive impact from the LA wildfires.

In REIT News

• Barclays initiates VICI with an Overweight rating ($36 price target)

• Deutsche Bank upgrades CUBE ($45), NSA ($38) and PSA ($299) to Hold from Sell

• Scotiabank upgrades EXR to Sector Perform from Sector Underperform (maintain $167 price target)

• On Friday morning, NLOP announced the sale of five office properties in AZ, MI, MN, MO, and WI during November and December for gross proceeds totaling $43.3 million and net proceeds after closing costs for the collateral pool assets were used to repay approximately $30 million on J.P. Morgan's senior secured mortgage and approximately $5 million on its mezzanine loan, in accordance with terms of those facilities and noted that gross proceeds from dispositions completed during 2024 to approximately $364 million, including occupied sales of $319 million at a weighted-average disposition cap rate of approximately 10.5%

• On Friday morning, PLYM announced an activity update for the fourth quarter of 2024 noting that 1) Leases commencing during the fourth quarter ended December 31, 2024, all of which have terms of at least six months, totaled an aggregate of 1,467,245 sf; 2) Rental rates under these leases reflect a 19.5% increase on a cash basis, with renewal leases reflecting a 12.4% increase on a cash basis and new leases reflecting a 33.0% increase on a cash basis; 3) Same store occupancy at December 31, 2024 was 95.7% while total portfolio occupancy at December 31, 2024 was 92.5% and reflects a 110-basis-point negative impact from previously disclosed tenancy issues in Cleveland, a 10-basis-point positive impact from the inclusion of the recently acquired Cincinnati portfolio, and a 70-basis-point negative impact from net leasing activity in the fourth quarter of 2024; 4) Executed leases commencing during 2024, all of which had terms of at least six months, totaled an aggregate of 5,827,136 sf as these leases, which represent 71.4% of total 2024 expirations, include 4,180,593 sf of renewal leases (21.4% of these renewal leases were associated with contractual renewals; there are no remaining 2024 contractual renewals) and 1,646,543 sf of new leases, of which 138,924 sf was vacant at the start of 2024 where rental rates under these leases reflect a 17.3% increase on a cash basis, with renewal leases reflecting a 12.8% increase in rental rates on a cash basis and new leases reflecting a 28.2% increase on a cash basis

• On Thursday afternoon, PECO announced the closing of the second amendment to its unsecured revolving credit facility which increases the size of the Revolving Credit Facility to $1.0 billion (from $800 million) and extends the maturity date to January 9, 2029, with options to extend maturity for two additional six-month periods plus the Company can increase the Revolving Credit Facility or incur new term loans by up to $500 million and increase the existing term loan by up to $200 million subject to further syndication

• On Thursday afternoon, FVR announced 1) During the fourth quarter, it acquired 29 new properties for $103.4 million at a weighted average cash capitalization rate of 7.9% and a weighted average lease term of 11.0 years noting that the acquisitions were spread across 7 industries, 17 tenants, and 16 states, including 12 new tenants and four new states; 2) Subsequent to quarter-end, it acquired one property for $2.0 million and have signed PSAs for an additional $53.0 million of properties; 3) On December 30, 2024, they drew down on its $200 million delayed-draw term loan in full as the term loan has a five-year duration after consideration of extension options and bears interest at adjusted SOFR plus 1.2%; and 4) On December 30, 2024, they repaid in full its $253 million ABS notes using proceeds from the $200 million delayed-draw term loan, revolver borrowings, and available cash on hand

• On Thursday afternoon, AIV announced that its Board of Directors has decided to explore additional alternatives in an effort to further unlock and maximize shareholder value as the exploration will expand upon its ongoing efforts such as reducing exposure to development activity and monetizing certain assets, and include, but not be limited to, exploration of potential sales of the major components of the business (in one or a series of transactions), an acceleration of individual asset sales, or a sale or merger of the Company as a whole

• On Thursday morning, IRT announced that its operating partnership entered into an amended and restated unsecured credit facility which increases the borrowing capacity under its existing revolver from $500 million to $750 million and extends the maturity date of the revolver from January 2026 to January 2029 where as of closing, the amount outstanding under the revolver was $214 million and proceeds from the expanded revolver will be used for general corporate purposes

• On Thursday morning, HST announced it has been named to the Dow Jones Sustainability World Index for the sixth consecutive year, maintaining its position as a global sustainability leader plus has been included in the DJSI North America for the eighth consecutive year

• On Wednesday afternoon, KIM announced the acquisition of The Markets at Town Center, a 254,000 sf premier asset in Jacksonville, FL for $108 million and noted that the acquisition marks the first property it has acquired through its Structured Investment Program, which is designed to strategically deploy mezzanine financing while securing rights of first refusal or rights of first offer on portfolio-enhancing assets

• On Wednesday afternoon, VNO announced that its 52% owned street retail JV completed the previously announced sale to UNIQLO of the portion of its U.S. flagship store at 666 Fifth Avenue owned by the retail JV for $350 million and noted that the JV continues to own 23,832 sf of retail space (7,416 sf at grade) at 666 Fifth Avenue consisting of the Abercrombie & Fitch and Tissot stores plus the $342 million of net proceeds from the sale were used to partially redeem its $390 million of preferred equity on the asset

• On Wednesday afternoon, NHI announced a series of changes to the Board of Directors which enhances the Board's ability to provide strategic and independent guidance including 1) Robert A. McCabe, Jr. was appointed to serve as Chair of the Board, effective immediately, following the recent retirement of W. Andrew Adams on December 31, 2024; 2) Candice W. Todd was appointed to the Board to fill the vacancy of Mr. Adams' retirement; 3) D. Eric Mendelsohn, President, CEO and Board member, was appointed to serve in the newly created role as Vice-Chair of the Board effective immediately; and 4) Ms. Todd was appointed to serve as the Chair of the Audit Committee and as a member of the Nominating and Corporate Governance Committee. Ms. Todd was also appointed as a member of the Special Committee plus effective as of January 1, 2025, the Board has appointed Lori Wittman to serve as its lead independent director

• On Wednesday afternoon, GMRE announced that as part of the Company’s succession planning efforts, the Board of Directors has reached an agreement with Mr. Jeffrey Busch, Chairman of the Board of Directors and Chief Executive Officer of the Company, regarding Mr. Busch’s transition from service as CEO and with anticipated continuation as a member of the Board and pursuant to the agreement with Mr. Busch, his service as CEO will end on the first to occur of (i) the date that a successor CEO has been appointed by the Board pursuant to the Company’s CEO succession plan or (ii) June 30, 2025

• On Wednesday afternoon, GNL announced that closed transactions as part of its 2024 strategic disposition initiative totaled $835 million through December 31, 2024 at a 7.1% cash cap rate

• On Wednesday afternoon, CURB announced investment activity for the fourth quarter of 2024 noting that “The Company closed on the acquisition of 20 convenience shopping centers for $206.1 million with the investments funded with cash on hand. The Company remains in a net cash position at year end with an undrawn $400 million revolving credit facility and $100M delayed draw term loan facility. Additionally, Curbline executed new leases with several new to portfolio tenants highlighting the depth of leasing prospects and strength of demand for available space.”

• On Wednesday morning, TRNO announced that it sold an industrial property located in Union City, CA for a sale price of approximately $16.9 million noting that the vacant property consists of one industrial distribution building containing approximately 66,000 sf on 3.0 acres and the unleveraged internal rate of return generated by the investment was 13.0%

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Have a great day!

David Auerbach & Mary Jensen